New report pinpoints fees as source of exploitation in the prison phone industry

EASTHAMPTON, MASS.— In a time when unlimited long distance phone service is rapidly becoming the norm, the families of incarcerated people are forced to pay several dollars per minute to stay in touch, reveals a new Prison Policy Initiative report released today. The report, Please Deposit All of Your Money: Kickbacks, Rates, and Hidden Fees in the Jail Phone Industry, casts a light on the dark underbelly of the telecommunications industry," said lead author Drew Kukorowski.

The Federal Communications Commission is currently considering imposing regulations that would cap the rates charged for a phone call from a correctional facility. "But charging $0.89 cents a minute is just the tip of the iceberg," says Kukorowski, "because families are forced to pay fees at every step of the way, including deposit fees, per-call fees, account fees, and refund fees." The report concludes that these fees add an estimated $386 million each year to families' phone bills.

Calls home from prison and jail are so expensive because, Kukorowski explained, "the prison phone companies get exclusive contracts in exchange for kicking back the lion's share of the profit to the correctional facility." The report reveals that sharing up to 84% of the call revenue with the correctional facility eats into the phone companies' potential profits, so they charge consumers additional fees that are not subject to the commission payments. The report is the first to address in detail the many prison phone industry fees that consumers must pay.

The harm of high calling rates doesn't end with the families of incarcerated people, the report warns. Social science research is clear that strong social ties between incarcerated people and their communities lower the likelihood that a released person will commit another crime.

The report calls on the Federal Communications Commission (FCC) to outlaw the kickback system that drives up the cost of phone calls, and to cap both the rates and the fees charged to the families of incarcerated people. In the meantime, the report suggests, state and local contracting authorities can do their part to bring fairness to the prison phone industry by refusing to accept commissions from prison phone companies and demanding transparency in the contracts.

The FCC is currently considering capping prison phone calling rates, and has just finished collecting public feedback on a regulatory proposal. The report urges the FCC to impose regulation that addresses the totality of consumers' bills, and to pay special attention to the many fees charged. "If the FCC regulates only the per-minute rates, the phone companies could instantly restore their monopoly profits by charging families more fees," said Kukorowski. "The FCC needs to ensure that phone bills are reasonable so that families can afford to stay in touch."